The pandemic has provided us an opportunity to step back and reassess the state of health infrastructure and its resilience to similar pandemics that might crop up in future. The National Health Policy, 2017, had recommended a national public health spending target of 2.5% of gross domestic product (GDP) by fiscal 2025. The 11th Five Year Plan (2007-12) had recommended a target at 2% of GDP. But health expenditures were still at 1.27% in fiscal 2020. In 2019, the World Health Organization ranked India 57 out of 195 countries on its Global Health Security Index, pointing out the weak spots in India's health preparedness. The pandemic further exposed these chinks, bringing the healthcare delivery system to the brink of collapse during the virulent second wave.

One positive outcome was that most states shifted focus towards health expenditure. The rise in expenditure generally corroborated with the intensity of Covid-19 in the states. Yet, surprisingly, medical and public health expenditure share slowed in a few states such as Gujarat and Telangana in fiscal 2021 compared with past three-year averages. We found that richer states spend more on healthcare. Further, higher per capita health spending was associated with better health outcomes in the following year. This should act as an incentive for states that spend less on health, to increase their focus on this essential expenditure. This also merits resource mobilization and/or greater targeted transfers to poorer states to allow them to catch up.

India's public healthcare spending at ~1.3% of GDP is abysmally low. Combined with the high out-of-pocket expenditure, it implies that a catastrophic health event such as this pandemic could push the vulnerable further into poverty. Hence, it is imperative to continue prioritizing healthcare, in state and central budgets. Studies have shown that if public healthcare expenditure is raised from an initial low base, out-of-pocket expenditure as a share of total health expenditure drops sharply.

If the pandemic has highlighted the gross inadequacies of India's healthcare infrastructure, it has equally amplified the long-standing issues of healthcare access and affordability, particularly for non-communicable diseases. Expanding the Ayushman Bharat scheme to ensure adequate and universal healthcare coverage must become a primary focus in this regard.

The benefits of technology as seen during the pandemic may be leveraged to provide last-mile healthcare access, particularly through telemedicine. But both state and central governments must spend on healthcare infrastructure to complement the digital health mission.

Thus, it's time the Centre and states ramped up public healthcare expenditure.